[Congressional Record Volume 162, Number 84 (Thursday, May 26, 2016)]
[Senate]
[Pages S3270-S3272]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
COMMENDING JOHN KOSKINEN
Mr. CARPER. Mr. President I want to take another few minutes--I think
I have the time. I don't see anybody waiting to speak. I want to take a
minute and say something about a fellow named John Koskinen. John
Koskinen is the Commissioner of the IRS. In 2013, at a time of great
tumult at the IRS, President Obama turned to John Koskinen to lead the
IRS because of his reputation in the public and private sectors as a
go-to manager of troubled enterprises.
He was 74 at the time. He agreed to take this on. He did not need to
do this. He needed to do this job like he needed another head, but he
said that he would do it. He agreed to do it because the President
asked him to serve our country, and they needed a strong leader at the
IRS.
Prior to his service at the IRS, he held the position of Non-
Executive Chairman at Freddie Mac from September 2008 to December 2011.
During that time he served as the interim CEO at Freddie Mac--that was
a tumultuous time, a very difficult time for our country--and as the
principal financial officer after the death of Freddie Mac's acting CFO
in April of 2009.
He retired from the Freddie Mac board in 2012. I want to mention
another thing or two about John Koskinen's service prior to coming on
board in the last decade to help us in the public sector. Prior to
serving on the Freddie Mac board, Koskinen served as the president of
the U.S. Soccer Foundation from 2004 to 2008. He also previously served
as deputy mayor of the District of Columbia, the Deputy Director for
Management at the Office of Management and Budget, and the Chairman of
the President's Council on Year 2000 Conversion.
Prior to entering government service, John Koskinen worked for 21
years for the Palmieri Company, as vice president, president, CEO and
chairman, working in the realm of turnarounds--a person helping to turn
around large failed enterprises. Earlier in his career, he served as
the administrative assistant to then Senator Abraham Ribicoff,
legislative assistant to Mayor John Lindsay, and Assistant to the
Deputy Executive Director of the National Advisory Commission on Civil
Disorders.
He practiced law with the firm of Gibson, Dunn & Crutcher and clerked
for Judge David Bazelon, chief judge of the U.S. Court of Appeals for
the District of Columbia.
He got his bachelor's degree from Duke University and his law degree
from Yale. I mean, what a resume.
At the age of 74, as somebody who helped turn around a lot of failed
enterprises, our President reached out to him and probably said: I know
you are 74, an age where a lot of people are more interested in slowing
down and taking life easy. He took on one of the toughest challenges of
all.
He is one of the finest people I know in public service. There are
some folks in the Congress who have been asserting that he is unfit for
service. I just want to say: They could not be more mistaken. This a
good and decent man. I was raised to treat other people the way I want
to be treated, to figure out the right thing to do, and to treat others
the way I want to be treated.
Given the sacrifices that he has made with his life at this stage of
his life, rather than taking brickbats, he should be taking bouquets.
So I would say to you, John Koskinen, if you are out there listening: I
know you have other things to do rather than listen to wrapups here in
the Senate before we begin the Memorial Day break, but I want to say
thank you for a lifetime of service, and thank you especially for your
service as our leader in the IRS. God bless you and your family. Thanks
to them for sharing with us a very good human being.
Mr. President, I ask unanimous consent to have printed in the Record
a letter dated May 23, 2016, from John Koskinen, Commissioner of the
IRS, whom I was just discussing, to the Honorable Bob Goodlatte,
chairman of the Committee on the Judiciary in the U.S. House of
Representatives.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Department of the Treasury,
Internal Revenue Service,
Washington, DC, May 23, 2016.
Hon. Bob Goodlatte,
Chairman, Committee on the Judiciary,
House of Representatives, Washington, DC.
Dear Mr. Chairman: Thank you for your letter of May 18
inviting me to testify at the Judiciary Committee hearing on
May 24 regarding the Committee's inquiry into allegations
made against me in my role as IRS Commissioner. I thank you
for extending me that courtesy, and for affording me the
opportunity to provide the Committee with information in
response to the issues raised by some Members of the House. I
have the deepest respect for you and for this Committee, and
recognize your Committee's responsibility to carefully
evaluate these allegations.
When the Committee announced this hearing, I was returning
from a week in China where I met with the tax administrators
of 43 nations to discuss international tax avoidance issues.
As a result, since I returned, my schedule has been more
crowded than usual, including preparations for a previously
scheduled hearing before the House Ways and Means Committee
on Wednesday, May 25. Therefore, the short notice provided
has left me without sufficient time to prepare to appear in
person on Tuesday for what could be a wide-ranging and
complex discussion regarding claims that may only become
clear after the hearing's first panel. Thus, while I must
regrettably decline your invitation, I remain willing to
appear before the Committee in the future.
In the meantime, if you think it is appropriate and helpful
to include in the record at this time, I enclose an initial
statement summarizing why the allegations against me lack
merit. I think this information may also be useful to
witnesses at the second hearing you have announced for June
with outside experts.
Should the Committee choose to undertake further steps, I
hope that it will do so in a manner consistent with the
House's longstanding concern for, and provision of, the due
process that must attend such a serious course of action. I
would be pleased to talk with you further at your
convenience.
Sincerely,
John A. Koskinen.
____
Written Statement of John A. Koskinen, Commissioner, Internal Revenue
Service Before the House Judiciary Committee--for Its Hearing:
Examining the Allegations of Misconduct Against IRS Commissioner John
Koskinen, Part I May 24, 2016
InTRODUCTION
Chairman Goodlatte, Ranking Member Conyers and Members of
the Committee, thank you for the opportunity to provide a
summary statement for the record in connection with your
review of the allegations by some Members of the House
Oversight and Government Reform Committee. I hope this
summary statement is helpful as you consider whether to
initiate a more formal inquiry. I stand ready to cooperate
with your Committee with regard to any actions it deems
appropriate.
I have great respect for our institutions of government,
including the United States Congress and each of its Members.
When I began my service as Commissioner of the Internal
Revenue Service, I took over an agency under investigation by
six different bodies
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and buffeted by ongoing, serious controversy. I regret that,
in the period since then, we have not been able to bring
these matters to a conclusion satisfactory to all Members of
this distinguished Body, including those who are testifying
today before you.
I believe the allegations you will hear described today,
and the related House Resolution are without merit, for
reasons summarized below. But I also acknowledge the strong
feelings that are held by some Members regarding this matter,
as well as their understandable frustration with the document
production and retention challenges of our agency during the
past several years. I also understand their deep concern
regarding the actions that gave rise to these controversies
--conduct that ended long before I arrived at the IRS. I am
committed to continuing to make improvements and working with
all committees and Members of Congress during my tenure as
Commissioner, and I sincerely hope that, over time, trust and
goodwill on all sides will be restored.
BACKGROUND
Let me begin by noting that I never sought the position of
IRS Commissioner, which I have held since December 2013.
After concluding my work as Non-Executive Chairman of Freddie
Mac, having been asked to undertake that role in the wake of
the financial crisis by President George W. Bush's
Administration, I was happily retired. I served on the boards
of two large, publicly-traded companies and tried to keep up
with my grandchildren. But I agreed to serve when approached
by the current Administration in May 2013, because I have a
longstanding commitment to public service, and because I
understand the importance of the IRS to the government and
the nation. The IRS collects more than 90 percent of the
revenue that funds the operations of the Federal government,
and the agency's activities touch virtually every American.
When I came to the IRS, I knew no one who worked at the
agency, and to this day I have never met or spoken to former
IRS Director of Exempt Organizations Lois Lerner. By the time
I was confirmed as Commissioner in December 2013, six
investigations were already well underway in response to the
May 2013 report by the Treasury Inspector General for Tax
Administration (TIGTA) regarding the use of improper criteria
to process applications for tax-exempt status under section
501(c)(4) of the Internal Revenue Code.
It should be noted that organizations applying for
501(c)(4) status at that time did not need a determination
from the IRS to undertake their activities. Until last
December, when Congress passed the Protecting Americans from
Tax Hikes (PATH) Act--which requires 501(c)(4) organizations
to advise the IRS when they begin activities--any entity
could operate as a 501(c)(4) simply by filing the annual
information returns required by the IRS. Nonetheless, those
organizations had a right to a determination if they sought
it, and the IRS had an obligation to provide that
determination promptly and efficiently. Early in my tenure, I
apologized to all groups who experienced inordinate delays
and complications in the review of their applications.
My goal from the start has been to respond as quickly and
completely as possible to inquiries from any of the six
investigating entities, to help them develop recommendations
that would in turn assist us in ensuring that the management
failures described in TIGTA's May 2013 report would never
happen again.
My previous experience in government helped me to
understand the importance of complying with such
investigations. Earlier in my career, I spent four years as
Chief of Staff to former Sen. Abraham Ribicoff, who served as
Chairman of a subcommittee of the Senate Governmental Affairs
Committee and, ultimately, as Chairman of the Committee. The
Committee held hearings on a variety of important issues, and
my involvement in those hearings impressed upon me the
importance of Congressional oversight of the Executive
Branch, and the responsibility of agencies to respond as
quickly and completely as possible to requests for
information from Congress.
In response to the May 2013 TIGTA report, the IRS accepted
and implemented all of the Inspector General's
recommendations, with one exception. The only recommendation
we have not completed involves clarifying how to measure the
social welfare and political activities of section 501(c)(4)
organizations. Before I became Commissioner, the Treasury and
the IRS drafted proposed regulations on this issue for public
comment. The regulations proved to be very controversial and
provoked over 160,000 comments. I suggested that we start
over, taking into consideration the range of comments
provided and emphasizing that our goal was not to change the
basic, existing rules but, instead, to clarify them as
recommended by the TIGTA report. We were instructed by
Congress in December to halt our work in this area, which we
have done.
TIGTA reviewed our actions in response to the May 2013
report, and issued a follow-up report in March 2015 that
noted the IRS had taken ``significant actions'' to address
their recommendations. We also accepted and implemented their
additional suggestions.
In August 2015, another of the six investigating entities,
the Senate Finance Committee, concluded its two-and-a-half
year investigation with an exhaustive report. As I testified
to the Finance Committee in October last year, the IRS
accepted all the recommendations in the Committee's report
that were within our control--those that did not involve tax
policy matters or legislative action. They included 15 of the
report's 18 bipartisan recommendations. We also accepted and
have implemented all of the recommendations within our
control in the separate reports prepared by the Majority and
Minority of the Committee.
In addition to the Senate Finance Committee, the Senate
Permanent Subcommittee on Investigations, the Department of
Justice (DOJ), and TIGTA have concluded their investigations
and their work, with the exception of one historical review
being done by TIGTA. None of these entities have indicated
any further action or activity is necessary or required.
Despite that, some Members have urged the House to impeach
me. Impeachment is, of course, an extraordinary tool, used
very rarely by the House after a careful and deliberative
process, including, in previous cases, providing substantial
due process and other safeguards to the accused individual.
These safeguards, which include adequate time to prepare and
the right to call and examine witnesses, are not part of this
preliminary inquiry. And as described below, I believe
impeachment is a wholly improper tool in this instance.
RESPONSES TO THE ALLEGATIONS IN THE PROPOSED ARTICLES OF IMPEACHMENT
As indicated earlier, I believe there is no substance to
any of the four charges put forward by some Members of the
House Oversight and Government Reform Committee. My responses
to these allegations can be summarized as follows:
Proposed Article I
The IRS, under my direction, responded to Congressional
requests for information with a massive production of
documents.
Both TIGTA and DOJ have determined that the erasure of
disaster recovery tapes was an accident.
No one has even suggested, nor could they suggest, that I
was somehow personally involved in the erasure of the tapes.
The IRS has taken steps to prevent a repeat of the failure
to preserve information.
Under my direction, the IRS has responded comprehensively
and in good faith to the various subpoenas and document
requests from the investigating entities.
Despite historically low levels of funding, the IRS
incurred more than $20 million in expenses (and devoted more
than 160,000 man-hours) to collect, review, and produce
approximately 1.3 million pages of documents. As part of this
massive document production, the IRS recovered and produced
over 78,000 emails that were sent or received by former IRS
Director of Exempt Organizations Lois Lerner, including over
24,000 emails from the period affected by Ms. Lerner's hard
drive crash.
The IRS was able to recover such a large number of emails
by looking in the places where it believed the emails were
most likely to be found: in the email accounts of IRS
employees that Ms. Lerner worked with or supervised. The
IRS's strategy was to make up for any technical or
recordkeeping shortcomings that may have existed by pursuing
a broad, even redundant, document collection and review
effort.
The erasure of 422 disaster recovery tapes at Martinsburg,
West Virginia was clearly a failure of the IRS's document
preservation protocols. The IRS accepts responsibility for
it, and as detailed in its submissions to Congress, has
improved employee training and taken other measures to
minimize the risk that anything like this could ever happen
again. However, both TIGTA and DOJ agreed that the erasure
was an accident. As TIGTA stated in its investigative report,
its extensive interviews ``provided no evidence that the IRS
employees involved intended to destroy data on the tapes or
hard drives in order to keep this information from Congress,
the DOJ or TIGTA.''
Proposed Article II
I acted in good faith in my efforts to comply with all
Congressional requests related to the investigations.
I testified truthfully and to the best of my knowledge in
answering questions concerning the search for, and production
of, emails related to the investigations.
The IRS only became aware of the accidental erasure of
disaster recovery tapes in 2015, after being notified by
TIGTA during its investigation of the Lerner hard drive
crash.
The allegations that I somehow attempted to deceive
Congress are unfounded. On June 20, 2014, I testified to the
House Ways and Means Committee that ``since the start of this
investigation, every email has been preserved. . . .'' That
was my honest belief at the time, as I was not yet aware of
the Martinsburg erasure.
I only became aware of the erasure in 2015, after TIGTA
briefed the IRS on the matter. On June 23, 2014, I testified
to the House Oversight and Government Reform Committee that
``backup tapes from 2011 no longer existed because they had
been recycled,'' and that IRS personnel ``went back and
looked and made sure'' of this. This was my honest belief,
based on briefings with IRS Information Technology (IT)
personnel.
On March 26, 2014, in testimony to the House Oversight and
Government Reform Committee, I promised to produce ``all of
Lois Lerner's emails.'' As detailed in the discussion above,
the IRS made great efforts to
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produce all available Lerner emails, conducting a broad
search at substantial expense. The breadth of the IRS's
efforts illustrates the good faith underlying the promise to
comply with the Committee's request.
Proposed Article III
The IRS went to great lengths to cooperate with and
facilitate the various investigations into the determination
process for tax-exempt status.
The main allegation seems to be that I somehow impeded
Congressional investigations by delaying for four months in
notifying Congress regarding the Lois Lerner hard drive
crash. This is inaccurate. It was never my intent to impede
the investigations in any way; to the contrary, the IRS went
to great lengths to cooperate with and facilitate the various
investigations.
It is important to note that the Lerner hard drive crash
was by no means purposely hidden from Congress. Emails
discussing the hard drive crash were included in the
substantial production of emails to the Congress months
earlier, in 2013. Documents provided included a series of
emails to Ms. Lerner in 2011 from the IRS IT division
discussing the computer problems she experienced with her
hard drive crash and IT's efforts to resolve them.
It was not until February 2014 that agency attorneys
discovered a problem with Ms. Lerner's emails. The IRS
attorneys also did not discover this from the e-mail
exchanges that had been earlier provided to the Congress.
Instead, the discovery was made when IRS attorneys, who were
producing emails for the Congressional committees, noticed an
apparent chronological ``gap'' in the Lerner emails that had
already been provided to Congress in 2013. After making this
discovery, IRS officials worked to assess what happened,
determine whether and how data was lost, and study how the
data might be recovered from other sources.
I first learned the details of the Lerner hard drive crash
in April 2014, and directed IRS personnel to continue the
work of determining the extent of the data loss so that a
complete description of the problem could be provided outside
of the IRS. That work identified 24,000 of Ms. Lerner's
emails from the crash period that could be provided to the
various investigators. When the IRS completed its assessment
of the Lerner email situation in June 2014, we made a full
and timely report to the Congressional committees, DOJ and
TIGTA.
Proposed Article IV
I oversaw a broad document collection and review to comply
with the investigations.
The gist of this allegation is that I failed to competently
oversee the IRS's response to Congressional investigations.
There has been no suggestion that I denied IRS personnel the
needed resources nor in any other way impeded their efforts
to respond to the varied Congressional inquiries. To the
contrary, as detailed above, the IRS conducted a broad
document collection and review, producing a comprehensive
record of the matters under investigation, notwithstanding
substantial technical and resource challenges. I received
regular reports on the work to complete this effort by IRS
lawyers and other personnel. Much of this work was done
during my first months on the job. Our goal was to provide
TIGTA, DOJ, and the Congressional committees all of the
information that they needed to advance and ultimately
complete their investigations.
CONCLUSION
While the allegations raised by some Members of the House
Oversight and Government Reform Committee are serious and
relate to acknowledged errors made by the IRS, the
Constitution reserves the use of impeachment for ``treason,
bribery, or high crimes and misdemeanors.'' None of my
actions relating to the issues above, viewed in light of all
the facts, come close to that level.
I would also note that impeachment has been used only on
very rare occasions in the 228-year history of our
Constitution. Aside from two Presidents, the only impeachment
of a member of the Executive Branch occurred in 1876. If the
Committee were to go forward and pursue impeachment in this
instance, especially in light of the utter lack of support
for the allegations, it would set an unfortunate precedent,
diminishing the ability of the Federal government to attract
experienced, dedicated people to positions of leadership.
Some have suggested that my impeachment would be an
appropriate means of holding the IRS accountable for acts of
others that occurred before I came to the agency. This
approach would make it particularly hard to attract new
leaders when they are needed most--when a critical agency is
in crisis following serious mistakes, needing both to reform
its practices and respond to investigations. That would be a
great loss for the government and for the country.
I want to be clear that, despite being faced with these
unwarranted allegations, I remain honored to serve as the IRS
Commissioner, and to lead a group of employees who are as
dedicated, skillful, energetic and enthusiastic as any group
I have had the privilege to work with.
Chairman Goodlatte, Ranking Member Conyers and Members of
the Committee, this concludes my statement.
Mr. CARPER. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The senior assistant legislative clerk proceeded to call the roll.
Mr. McCONNELL. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
____________________